The AUD/USD pair tried to rally during the course of the session on Friday, but gave back most of the gains. By doing so, and ended up forming a very nasty looking shooting star, which sits just upon the top of the hammer from Thursday. Because of this, I feel that this market is still going to struggle every time it rallies, and I will look to short-term charts in order to find resistive candles to sell. I have no interest in buying this pair, because quite frankly I feel that the Aussie will continue to struggle in general. If we can break down below the 0.75 level, I think that this market will then go down to the 0.70 handle given enough time. Quite frankly, the US dollar looks very strong and the fact that the Australian dollar could not hang onto gains during the session that saw the US jobs report look so bad, that tells me just how soft the Aussie is.
Continue to sell rallies
Again, I’m going to sell rallies as they appear on short-term charts. I think that there is a massive amount of resistance all the way to the 0.80 handle, and quite frankly sooner or later a selling opportunity will rise every time we rally. It’s easier to simply sell the Aussie, simply because there are so many times where a bit of a bad economic announcement will crush risk appetite and of course the Australian dollar is considered to be at risk appetite type of asset.
Even if we broke above the top of the shooting star, I am not confident enough to hang onto a longer-term trade to the upside anyway, so at this point time I think that just offers more value in the US dollar as we rise. Pay attention to the gold markets, they certainly are not looking like they’re on fire at the moment, so I don’t know that they will offer a boost for the Aussie either.
